Private Landlords – Beware

I am a private landlord and I want to re gain my property from tenants, what do I need to do?

Landlords can serve a Section 21 notice which gives the tenant 2 months Notice to Quit the tenancy.

Is there anything that I need to be aware of before serving a Section 21 Notice?

You need to have protected the tenant’s Deposit in a government approved scheme at the beginning of the tenancy and served upon them prescribed information within 30 days.  Failure to do so will render the Section 21 Notice invalid and the Notice period will not take effect.

How do I protect the Deposit?

In order to hold the deposit in accordance with an authorised TDS scheme, the landlord must

1. register the deposit with one of the three authorised schemes within 30 days from the date upon which it is received
2. provide the prescribed information to the tenant within 30 days, and

Once complete the deposit protection certificate and all prescribed information for tenants must be served on the tenant. Landlords will only have to give the prescribed information once. They will not have to re-serve the information upon renewal of the tenancy.

What happens if I have a tenancy that pre dates April 2007?

The Government introduced a scheme that Landlords must protect Deposits paid to them by Tenants, for all Assured Shorthold tenancies (AST’s) entered into on or after 6 April 2007.  This requirement was originally understood to apply to ASTs that commenced on or after 6 April 2007, but after the Court of Appeal decision in Charalambous& Anor v NG & Anor [2014] EWCA Civ 1604 it appeared that the legislation applied, to tenancies starting before that date, that remains in existence after it.

What if my tenants had a fixed term which has since rolled on to a Statutory Periodic Tenancy?

New provisions under the Deregulation Act 2015, deal with some of the issues arising from the decision in Superstrike Ltd v Rodrigues [2013].  In Superstrike, a fixed term AST was created in January 2007, ahead of the introduction of mandatory deposit registration. A statutory periodic tenancy arose at the end of the fixed term in January 2008 and in 2011 a section 21 notice was served. The Court of Appeal held that, when the tenancy continued in January 2008 on a periodic basis, it effectively became a new tenancy. As a result, the existing deposit was deemed to have been ‘received’ in respect of this new tenancy at that point and required registration with a Tenancy Deposit Scheme. As the deposit had not been protected, the landlord was not entitled to serve a section 21 notice.

Overturning the Superstrike ruling, under the new provisions, landlords no longer have to worry about re-protecting a deposit when the end of the fixed term arrives and the tenancy becomes a Statutory Periodic Tenancy.

What if I have not protected the Deposit?

All deposits taken before 6 April 2007, where the AST became a statutory periodic AST on or after 6 April 2007 and were still running, must be registered.

The consequence of failing to register a deposit within that period meant that a landlord was liable to a civil penalty. If a deposit had not been protected then a section 21 Notice could not be served until it is protected.  The tenant is also entitled to make a penalty claim of one to three times their deposit depending on the circumstances.

What effect does the new Deregulation Act 2015 have on serving a Section 21 Notice?

The Deregulation Act 2015 now introduces additional requirements for the landlord to comply with in order to serve a valid Section 21 Notice, namely:

• a valid Energy Performance Certificate
• a valid annual Gas Safety Certificate.

In addition to the above the new regime allows for Section 21 notices to be served within different tenancy periods.  There are also implications on rent being repaid to the tenant if they decide to leave when they receive the Section 21 Notice.

Extreme caution should be taken when considering serving a Section 21 Notice to ensure that it complies with recent legislation and that the Landlord is not unknowingly enabling the tenant to further increase their term due to the notice becoming invalid.

At Colemans, we can give you specialist advice on Landlord and Tenant issues including advice in relation to Tenancy Deposit regulations, on Section 21 Notices and possession proceedings.

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This post was written by Colemans Solicitors LLP